Chancellor urged to ‘act now’ amid warning 3,000 homes face 'staggering' rise in mortgage payments

The Liberal Democrats are urging Chancellor Kwasi Kwarteng to take action without delay. Credit: PA

Chancellor Kwasi Kwarteng is being urged to “act now” as new analysis suggests more than 3,000 households are facing “staggering hikes” in their mortgage payments every day.

The Liberal Democrats are warning of a “mortgage ticking time bomb”, as the party predicts that between now and the expected release of the chancellor's medium-term fiscal plan on November 23, roughly 168,000 more homeowners will have been hit by a new higher rate.

It's caution is based on figures attributed to UK Finance showing 600,000 fixed-rate mortgage deals are coming to an end in the second half of 2022, equivalent to an average of 3,296 a day.

Meanwhile, rates are continuing to climb, pushing up costs for borrowers - with the average two-year fixed-rate deal topping 6% for the first time in 14 years last week.

Lib Dem leader Sir Ed Davey has called on the chancellor to bring forward his fiscal plan, as he warned people could lose their homes.

“Every day the government fails to defuse this mortgage ticking time bomb, thousands more homeowners are being hit with staggering hikes to their bills,” he said.

“But Kwasi Kwarteng has shown he doesn’t get it or doesn’t care. He may see it as just a ‘little turbulence’, but for people facing a catastrophic increase to mortgage payments it could mean losing their homes.

“Waiting until November 23 to act will be far too late for the thousands of families being tipped into mortgage misery.

“Conservative MPs must act now to help struggling mortgage borrowers on the brink.

“The Conservatives created this mortgage nightmare with their disastrous and out-of-touch budget, now they need to take action to fix it.”

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A government spokesperson said: “While the UK has seen disruption, global financial markets have also seen significant volatility in recent weeks.

“A range of factors are affecting mortgage and interest rates, which have been rising internationally in response to global trends including [Vladimir] Putin’s illegal invasion of Ukraine.

“We are doing what we can to support people with rising costs - our energy price guarantee will save the typical household around £1,000 a year and we are providing payments of £1,200 to the eight million most vulnerable families.

“The government is committed to strong fiscal discipline and to debt falling as a percentage of GDP over the medium term. Further details will be set out in a medium term fiscal plan, alongside a forecast by the independent OBR.”